Today, federal regulators filed a lawsuit in Salt Lake City, UT, alleging that Charles Scoville has been running Traffic Monsoon as a massive Ponzi scheme. Scoville and Traffic Monsoon’s assets were immediately frozen and a receiver will be appointed to secure and eventually allocate the $60 million that Scoville is alleged to be hoarding in U.S., Canada, and U.K. banks.
Those familiar with Scoville’s past schemes won’t be surprised at the SEC’s lawsuit–he founded and shuttered over 10 different MLM/HYIP companies and websites over the past decade:
TrafficMonsoon.com was started in October 2014 when Scoville when began billing it as a profit-sharing opportunity or Retail Profit Pool (RPP). The website purportedly made money by generating ad clicks, and investors were told that they would see a return of 10% (within 2 months) on a $50 purchase of “AdPacks”.
In addition to investing, participants were encouraged to go to the website and clicks on ads as a means of boosting revenue for the website (and subsequently, their returns). And, like all multi-level marketing schemes, participants were rewarded for recruiting other investors.
While customers were told that revenue for the company was generated primarily by ad clicks, in reality, almost 100% of the revenue came from the sale of AdPacks. Scoville’s scheme was lucrative enough to generate a high of $25 million per month at the beginning of 2016.
In early 2016, Traffic Monsoon stopped paying out ROIs due to a variety of reasons concocted by Scoville: TrafficMonsoon.com ran out of server space; database connection issues; people circulating fake checks; and finally, PayPal was unduly freezing his assets because the company was “growing too fast.”
In reality, PayPal was concerned about the apparent fraudulent nature of the business and froze his account while refusing to handle payment processing for the company (Scoville subsequently moved the bulk of the payment processing to Payza, a platform also utilized by Zeek Rewards in their failed Ponzi scheme). Once PayPal released his funds on July 11th, Scoville systematically withdrew funds and placed them into his personal account(s). PayPal withdrawals are limited to $100,000 each and he initiated 256 withdrawals (over $25 million) in the past 10 days.
Despite his protestations on Facebook, it appears as though he knew that Traffic Monsoon was nearing its end.
Update #1: After months of sporadic updates on the Traffic Monsoon Facebook page, Scoville re-emerged this morning in full damage control mode to explain the PayPal issues and expressing his resolve to fight the SEC’s allegations:
Update #2: Now Scoville is telling his victims that the SEC is being “kind” and “wonderful” and understands that he was “only moving funds to protect his customers.” If the recent Zeek Rewards lawsuit is any indication, Scoville should be a little more concerned, and Traffic Monsoon investors should take everything he says with a grain of salt.
Our recommendation–if you were an investor in TrafficMonsoon.com, get your paperwork in order so that you can hopefully claim at least a percentage of your original investment. Do not expect to get paid your ROIs.
History of Traffic Monsoon
TrafficMonsoon.com website launched by Charles Scoville.
PayPal stops processing payments and holds funds. Scoville moves bulk of processing to Payza.
July 11, 2016
PayPal releases funds, and Scoville immeditately begins transferring the maximum amount into his personal accounts.
July 27, 2016
SEC files lawsuit against Scoville and Traffic Monsoon and appoints complete control to a receiver, effectively ending Traffic Monsoon.
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